6 June 2013Cayman analysis

Cayman captive switches class to reinsurer

Southport Re, the reinsurance subsidiary of a New York City-based private equity firm, has become the first insurer in the Cayman Islands to take advantage of the Island’s recently amended Insurance Law. The entity, which operated originally with a Class B captive license, is now operating with a Class D open-market reinsurer license. Southport Re is now required to maintain a place of business in the Cayman Islands.

Dr Dax Basdeo, chief officer in the Ministry for Financial Services, said: “Southport Re is a significant addition to our financial services community. Their decision to decision to migrate from a Class B to a Class D insurer underscores our strength and competitiveness in our reinsurance sector.”

According to Cayman Island Monetary Authority director Cindy Scotland, the amended insurance law enhances Cayman’s capability to effectively regulate the risks faced by different classes of insurers. She commented: “this is a key reason for differentiating between captives and reinsurers.”